Monday, 26 September 2016

In a nuanced and careful speech on Saturday
that had components of both pragmatism and jingoism, Prime Minister Narendra
Modi skilfully created a narrative for deflecting war hysteria in India, redefining
the burgeoning confrontation with Pakistan in terms of a Lagaan-style contest for eliminating poverty, illiteracy and
deprivation in the two countries.

In Lagaan,
a Hindi-language, Oscar-nominated 2001 motion picture, a land tax dispute
between pre-independence British administrators and residents of a small,
central Indian village was settled through a cricket match between the two
sides (the Indians won!). On Saturday, with an inflamed India looking to Mr
Modi for his first statement after Pakistan-based Lashkar-e-Toiba jihadis killed 18 Indian soldiers in
Uri, Jammu & Kashmir (J&K) Mr Modi appropriated former Pakistani
premier Zulfiqar Ali Bhutto’s threat of a 1,000-year war with India, challenging
Pakistan to a 1000-year war to whittle away poverty, illiteracy and child
mortality.

Mr Modi’s speech, delivered to a Bharatiya Janata
Party gathering in Kozhikode, was a masterly balancing act. With the national
temper at fever-pitch after Uri and the media resounding with anti-Pakistan warmongering
--- such as BJP leader Ram Madhav’s threat to extract a jaw for every tooth ---
Mr Modi had to placate public anger in India, while simultaneously defusing a
situation that could only escalate if India extracted vengeance through
cross-border military strikes on terrorist infrastructure or the Pakistani Army
(numerous Indian commentators see little difference between the two). As it
turned out, Mr Modi delivered a carefully crafted message that favoured peace,
while delivering enough tough talk to placate Indian anger.

Mr Modi led, as expected, with a frontal attack
on Pakistan for being the global leader in exporting terrorism. He followed up
by apparently repeating, but actually toning down the promise of retaliation he
had delivered just after the Uri attack. On that day he had tweeted: “I assure
the nation that those behind this despicable attack will not go unpunished”,
raising widespread expectations of retaliatory military action. On Saturday, he
thundered: “The sacrifice of our 18 soldiers will not be forgotten. We will
ensure that the international community works to isolate you.” This suggested
that working to make Pakistan an international pariah would be sufficient
retribution. For those in Pakistan who carefully parse the New Delhi tealeaves,
the juxtaposition of cause and effect was significant, “the sacrifice of 18 soldiers”
being the cause; and “the isolation of Pakistan” being the effect. Nor did the PM
mention or endorse his military’s earlier threat to retaliate at “a time and
place of [its] own choosing”.

Mr Modi’s layered messaging will take time
to be clearly understood within Pakistan. Given the prevailing climate of
confrontation, even the moderate English-language media in Pakistan interpreted
the speech in the light of the threats it contains, not the outreach. The headlines
in Daily Times say: “Modi vows
campaign to ‘isolate’ Pakistan”. Dawn
headlined: “Modi says India will work to ‘isolate’ Pakistan internationally”.
Only the relatively sophisticated Express
Tribune headlined its coverage: “India backs off after frenzied war rhetoric”.
Pakistani audiences would also be keenly attuned to Mr Modi’s taunts about unrest
in Pakistan Occupied Kashmir (POK), Gilgit-Baltistan, Khyber Pakhtunkhwa and
Baluchistan, so not much can be expected in terms of immediate win-over. Only
when the dust settles on the current confrontation will the Pakistani media and
the populace take note of the Indian PM’s ground breaking outreach. Towards
that day, Mr Modi differentiated between Pakistan’s leaders and the people of that
country; a radical departure from New Delhi’s customary lumping together of
Pakistan’s political class, the public and even its terrorists. But the most
important component of Mr Modi’s speech was to de-escalate current tensions.
Policy analysts in Rawalpindi (Pakistan Army headquarters) will immediately
note that the battle Mr Modi is talking up is not military, but a long-term
developmental campaign relating to the uplift of the masses.

When Mr Modi borrowed the inspiring
phraseology of one of his predecessors, Atal Behari Vajpayee, about dealing
with Kashmir in the ambit of “insaaniyat,
jamhooriyat aur Kashmiriyat” (humanism, democracy and Kashmir’s syncretic
culture), it carried little conviction, making Mr Modi seem like a peacock in
borrowed feathers. But his rousing call from Kozhikode --- “I want to tell the
people of Pakistan. We are ready to fight you, if you have the courage. Come,
we'll fight poverty in our country and you fight in yours. Let's see who
eradicates poverty first” --- could become his signature initiative in
India-Pakistan relations.

This depends on whether and how Mr Modi
instrumentalises this rhetoric to resurrect India-Pakistan relations, which are
currently in the deepest freeze since the 26/11 Mumbai strikes. Sceptics are
already declaring that the Pakistani deep state --- the military-bureaucratic
syndicate that call the shots in that country --- does not particularly care
about development. That, however, is an outdated argument. With Washington’s
funding to Islamabad becoming increasingly conditional and New Big Brother
China far less munificent than Uncle Sam, the Pakistani establishment
recognises fully that a sickly and under-developed economy can no longer afford
a military that is capable of warding off India.

As the contours of Mr Modi’s new direction
come more clearly into view, he will face flak from opposition parties for
back-tracking on his strident campaign rhetoric about how toughly he would
handle Pakistan, and about what a strong PM he would be in contrast to Manmohan
Singh. The Congress Party will heckle him for citing India in his speech as a
globally-respected, well-developed state that “exports software to the world
while [Pakistan’s] leaders export terrorism”; with this modern India presumably
having been built during the “60 years of Congress misrule” that Mr Modi routinely
slams. Even so, the PM has done well to de-escalate the current crisis. It
makes little sense to confront Pakistan, for benefits that are not readily
apparent, only because of a hard line taken earlier.

Anti-Modi sceptics are already voicing fear
that domestic politics might induce the PM to balance his conciliation of
Pakistan by doubling down on domestic intolerance and galvanising campaigns
like the beef ban and love jihad, perceived as anti-Muslim. It is incumbent on Modi
to alleviate these fears. Finally, Pakistan can be managed only up to a point;
beyond that remains in the hands of that country’s unpredictable leaders. What
Mr Modi does have full control over is his management of Kashmir and the initiating
of a calibrated, all-of-government campaign to defuse tensions and address
long-standing problems in that state. That would not just solve a major
internal problem for New Delhi, but snatch away from Pakistan its most potent
instrument for meddling in India.

In New Delhi, Defence Minister Manohar
Parrikar signed an inter-governmental agreement (IGA) with his visiting French
counterpart, Jean-Yves Le Drian; while officials signed commercial components
of the actual contract.

“Rafale is a potent weapon which will add
to the capability of IAF,” Parrikar said.

Senior ministry of defence (MoD) officials,
speaking anonymously after the signing, said the average cost of each Rafale
was fixed at Euro 91.7 million (Rs 686 crore). This included 28 single-seat
fighters, each costing Euro 91.07 million (Rs 681 crore); and eight twin-seat
fighters priced at Euro 94 million (Rs 703 crore).

Surprisingly the contract for 36 fighters
has no “options clause”. This means the Indian Air Force (IAF) must operate
just two squadrons of this new fighter --- the seventh type in the IAF
inventory --- or negotiate afresh for additional Rafales.

The weapons package includes a stockpile of
Meteor “beyond visual range air-to-air missiles” (BVRAAMs), which can shoot
down enemy fighters that are 120-140 kilometres away. Each Meteor missile,
built by Franco-British-Italian vendor MBDA, has a ticker price of some Euro
two million. The Meteor is currently integrated into three fighters --- the
Eurofighter Typhoon, Gripen NG and Rafale.

The contract also includes a stock of the
million-dollar SCALP missile --- a French acronym for General Purpose Long
Range Standoff Cruise Missile --- also known as the Storm Shadow. The SCALP,
which can be fired from standoff ranges at ground targets 500 kilometres away,
allows the Rafale to strike heavily-defended airfields, military headquarters
and strategic infrastructure.

Like the Mirage-2000 that Dassault supplied
the IAF earlier, the Rafale can be modified to carry nuclear weapons. Its long
operating range --- it can strike targets more than a thousand kilometres away
--- make it especially suitable as an aerial nuclear delivery platform.

Following the model of the C-17 Globemaster
III procurement from the US, a large share of the Rafale payout is for
“performance based logistics” (PBL). This means that for the first five years
of a Rafale’s service, Dassault will supply all spares and components,
including engines, and technicians needed to keep the fighter flying. The
vendor is liable to ensure that 75 per cent of the fleet is available at all
times.

The IAF has the option to extend PBL to 12
years, subject to a fresh contract being negotiated for the next seven years.

Says a top ministry official: “We are
currently getting 55-56 per cent availability from the Sukhoi-30MKI fleet. The
Rafale will give us 20 per cent more.”

Air power experts note that this sounds
better than it actually is. Over a fleet size of 36 Rafales, an extra 20 per
cent amount to 7 extra fighters operational at any time.

MoD officials cite Dassault’s claim that
the Rafale’s quick “turnaround time”, or the time between two sorties, allows
each fighter to do five operational sorties each day. While this claim would
need verification during actual usage, the IAF has determined during trials
that the Rafale’s engine can be replaced in just 30 minutes, compared to eight
hours for replacing a Sukhoi-30MKI engine.

The contract stipulates that the first
Indian Air Force (IAF) Rafale must be delivered within 36 months, i.e. in
September 2019. The entire order must be delivered within 67 months, which
means the last Rafale must join the IAF by April 2022.

Even though this is a significantly slower
induction rate than what the MoD had promised, Dassault will be hard pressed to
deliver in this time frame. It was building 11 fighters per year for the French
air force and navy, which are likely to slow down induction. Last year, Egypt
and Qatar ordered 24 Rafales each. It is not clear how quickly Dassault can
raise production or how it will sequence these commitments.

Indian officials say some delay was
inevitable because the IAF demanded a range of India-specific improvements to
customise the Rafale and “make it more potent than the French air force
Rafales”.

These include operational features like
“helmet mounted display sights” that allow pilots to aim their weapons merely
by looking at a target; a “radar warning receiver” to detect enemy radar and
“low band jammers” to foil it; a radio altimeter, Doppler radar, extreme cold
weather starting-up devices for airfields like Leh, and others.

The contract requires the IAF to pay a 15
per cent advance of about Rs 8,700 crore today. Since the IAF budget does not
cater for this, an additional allocation would be needed. Another 25 per cent
would be paid next year, for which the IAF would have to budget Rs 14,500 in
addition to its other commitments. The balance amount would be paid to the
vendor at stipulated delivery milestones over the coming years.

MoD officials say one of their biggest
achievements during price negotiations was to peg annual cost inflation at the
actual inflation level; or a maximum of 3.5 per cent. Earlier contracts with
French vendors had stipulated annual inflation at 4-4.5 per cent.

“Actual inflation in Europe is barely one
per cent, while we were paying four per cent. That means we have saved about
three per cent per year; or Rs 4,000-14,000 crore over the contract period,
depending upon the actual inflation in Europe”, says a senior MoD official.

The Rafale contract makes French vendors,
Dassault and Thales, responsible for discharging offsets worth 50 per cent of
the contract value, i.e. Rs 29,000 crore. While the vendors get to choose their
offset partners, the contract stipulates that 74 per cent of the liability
value must be discharged through component exports from India. There is also a
“technology sharing component”, amounting to six per cent of the total offsets,
which the vendors will negotiate with the Defence R&D Organisation.

The Rafale contract comes 15 years after
New Delhi first issued a Request for Information (RFI) for 126 medium
multi-role combat aircraft (MMRCA), of which 18 would be supplied in fly-away
condition and 108 progressively built in India. After a tender was issued in
2007, the IAF evaluated six fighter aircraft --- Boeing’s F/A-18E/F Super
Hornet: Lockheed Martin’s F-16IN Super Viper; RAC MiG’s MiG-35; Saab’s Gripen
C, the Eurofighter Typhoon and the Rafale --- in what was hailed as “the
world’s most professionally run fighter competition.”

In 2011 the IAF shortlisted the last two
fighters, and finally named Rafale the winner in 2012. That was followed by
three years of fruitless negotiations, dragged out by inconsistencies detected
in Dassault’s commercial bid. The deadlock was broken in April 2015, when Prime
Minister Narendra Modi announced on a visit to Paris that the IAF would buy
just 36 Rafales, off the shelf.

Friday, 23 September 2016

On a warm Delhi evening on April 3, 2015,
Defence Minister Manohar Parrikar had left his South Block office and was driving
to catch his flight to Goa, when his mobile phone received an incoming call
from the prime minister’s office (PMO). Could he come in urgently, an official
asked, the PM would like to talk briefly.

When Parrikar reached the PMO, Prime
Minister Narendra Modi sprang a bombshell. Parrikar was told that, on Modi’s
forthcoming trip to Paris, he and French President Francois Hollande would
announce an agreement for India to buy 36 Rafale fighters. During Modi’s nine-day
tour of France, Germany and Canada, Parrikar would have to manage the media and
field the inevitable questions.

Taken aback, Parrikar still caught his
flight to Goa. Over the next week, he batted loyally on behalf of his PM,
publicly defending a decision he neither understood nor agreed with, that was
taken over his head, and that senior ministry of defence (MoD) officials warned
him would be difficult to defend.

Today, 17 months later, most pledges that
Parrikar issued in defence of Modi’s Rafale agreement have proven incorrect. He
told PTI in Goa that all 36 Rafale fighters would join IAF service within two
years; in fact more than six years will elapse before the final delivery is
made. He repeated the Modi-Hollande undertaking that the price would be “on
terms that would be better than” Dassault’s bid in the now cancelled tender for
126 medium multi-role combat aircraft (MMRCA). It now turns out that India will
pay a vastly higher price.

But Parrikar, through 17 months of
defending a deal that was not his, has become the face of the Rafale. And after
Friday, when he and his visiting French counterpart, Jean-Yves Le Drian, sign
an inter-governmental agreement (IGA) for 36 Rafales, Parrikar and not Modi
will answer for the purchase.

There is disquiet within the MoD about the acquisition,
with officials concerned about subsequent scrutiny by constitutional
authorities like the Comptroller and Auditor General. Their key worries are as
follows.

Exorbitant
cost

A key element in price negotiations is
“benchmarking”, or comparing Dassault’s price with other contracts involving the
same fighter. With India, Dassault had already established a benchmark in the
MMRCA acquisition, where it had quoted a price for 18 fully built Rafales, just
like the 36 fighters that India is now buying.

Speaking to Doordarshan on April 13, 2015,
Parrikar had revealed Rafale’s bid for 126 fighters, stating: “When you talk of
126 [Rafale] aircraft, it becomes a purchase of about Rs 90,000 crore”, i.e. Rs
715 crore per fighter after adding all costs.

Now Parrikar would be buying 36 Rafale
fighters for Euro 7.8 billion (Rs 58,000 crore), which is over Rs 1,600 crore
per aircraft --- more than double the earlier price.

True, the current contract includes
elements that were not there in the 126-fighter MMRCA tender --- including a
superior weapons package with Meteor missiles; and performance-based logistics
(PBL), which bind Dassault to ensure that a stipulated percentage of the Rafale
fleet remains combat-ready at all times. The percentage is guessed to be about
75-80 per cent, an unchallenging target for western fighter types.

Even deducting Euro 2.8 billion for the
weapons and PBL from the anticipated Euro 7.8 billion contract amount, a Euro 5
billion price tag for 36 Rafales puts the ticker price of each at over Rs 1,000
crore. For that the IAF can buy two-and-a-half Sukhoi-30 MKI fighters --- a
heavy fighter as capable as the Rafale.

Variation
in fighter types

IAF logisticians, who already struggle to
maintain, repair and support six different types of fighters --- the
Sukhoi-30MKI, Mirage 2000, Jaguar, MiG-29, MiG-27, MiG-21 and the Tejas Light
Combat Aircraft (LCA) --- are hardly welcoming the prospect of a seventh fighter
type, which would require expensive, tailor-made base infrastructure, repair depots
and spare parts chains.

Air power experts say more Sukhoi-30MKIs
would eliminate this need, besides being cheaper. Alternatively, fast-tracking
the Fifth Generation Fighter Aircraft (FGFA), which Russia and India intend to
co-develop, would eliminate the need for Rafales.

Even if the IAF exercises an option clause
for 18 more Rafales, there would be just three operational squadrons, like with
the Mirage 2000. Besides the options clause, nine more Rafales would be needed,
since an IAF squadron has 21 fighters.

Sovereign
guarantees

While New Delhi is negotiating the Rafale
purchase directly with private vendor, Dassault, the MoD wants sovereign
guarantees from the French government, of the kind that come with American
equipment bought through the Foreign Military Sales (FMS) route. In a FMS procurement,
e.g. India’s C-130J Super Hercules purchase, the US Department of Defense (the
Pentagon) sets up a dedicated “project management team” that negotiates on the
buyer’s behalf, beating down the price, establishing training and logistics
support, and providing assurance that the buyer gets everything needed to
operate and maintain the product.

Alongside FMS support, corruption is
deterred by the stringent US Foreign Corrupt Practices Act, which vendors seldom
dare to violate. This provides comfort to Indian MoD officials against
subsequent allegations raised against a deal.

Paris, in contrast, is only willing to give
a lukewarm written assurance of support with the Rafale --- something that the
MoD refers to disparagingly as a “comfort letter”.

Piecemeal
contracting

India needs some 200-300 fighters to
replace the MiG-21 and MiG-27 fleet that is being phased out of service. Just
36 Rafales provides little cover, so the IAF hopes to buy not just 18 more
under the options clause, but perhaps another tranche later.

MoD officials complain that piecemeal
contracting provides little leverage for beating down prices. The same problem
will afflict the procurement of Gripen NG, or F-16s, which the MoD is weighing
as possible options to replace retiring fighters.

With an IGA in the offing, and a formal
contract yet to be negotiated, New Delhi would still have the opportunity to
address these issues, say MoD officials. Yet, the IGA on Friday will be
celebrated in the IAF as a giant step towards a fighter they have pursued
tenaciously for 15 years.

All central government employees have the
right to represent and air grievances against the awards of the 7th Central
Pay Commission (7th CPC) to an “Anomalies Committee” set up for this
purpose --- all except the military, which ironically constitutes the bulk of central
government employees and pensioners.

Now servicemen, in uniform and retired,
will have their say too. On Wednesday, the Punjab & Haryana High Court
issued notice to the central government, directed the Anomalies Committee to
take into account views of defence personnel.

Ruling on a petition by a serving officer, Colonel
Preetpal Singh Grewal, the High Court notice could go some way in easing the vitiated
civil-military relationship, and the trust deficit between civil servants and
the military.

The 7th CPC recommendations,
which were handed over to the government last November, aroused bitter
resentment within the military. On March 11, the three service chiefs made a
presentation to the “Empowered Committee of Secretaries”, a 13-member panel
headed by the cabinet secretary, which was looking into the recommendations.
After that brought no changes, the chiefs held the implementation of the 7th
CPC in abeyance, forcing the defence minister to order them last month to
implement the award.

In his petition, Grewal pointed out that
the Anomalies Committee granting hearings to civil employees, their
associations and the civil establishment but not to defence personnel or even
the military establishment. He pointed out that the defence services were not
even informed about the institution of the Committee and only discovered
through press reports that several meetings had been held with civil government
employees.

The petition admits that military employees
cannot be allowed to form associations. However, there was a need for
sensitivity within the system toward defence personnel, and the opportunity to
present their views and demands.

Denying this would violate the principles
of natural justice, the petition pleaded. It also pointed out that the Supreme
Court has already held that defence personnel should not be treated in a
‘shabby manner’ or denuded of rights that are available to other citizens.

Besides pleading for the opportunity for
serving and retired military personnel to be heard, the petition asked for an
alternative participative mechanism that would compensate for the statutory bar
on forming associations.

The petition pointed out that the defence
ministry’s Standing Committee on Welfare of Ex-Servicemen, which Defence
Minister Manohar Parrikar had himself ordered to hold meetings every three months,
has not yet held a single meeting. The petition argued that this amounted to
lower officials undermining political authority.

The petition suggested that differences be resolved
in a conciliatory manner, instead of implementing ham-handed measures that
created a gap between various services. It stated that the standoffishness of
high government authority created a trust deficit that could be exploited by
anti-national elements, which might spread discontentment through the social
media.

The 7th CPC has raised baseline
military salaries by about 15 per cent, taking the pay of a lieutenant (the
entry grade for officers) to Rs 56,100 per month; and that of a sepoy (the
entry grade for ratings) to Rs 21,700 per month. This was significantly lower
than the 40 per cent hikes handed out by the Fifth and Sixth Pay Commissions.
But the greatest resentment has taken place through the relative dilution of
status, with the Indian Administrative Service, Indian Foreign Service, Indian
Police Service and Indian Forest Service having been granted allowances that
the military believes places them on a higher level.

The
Indo-Pakistan war of 1965 should have taught us never to neglect our air
defence. On September 6 that year, with fighting spreading across the western
border, F-86 Sabre fighters from the Pakistan Air Force (PAF) pre-emptively swooped
down on the Indian Air Force (IAF) base at Pathankot, destroying 10 fighters on
the ground and damaging another three. Separately, Sabres struck Halwara air
base and shot down two IAF Hunters. Next day, in the eastern theatre, the PAF destroying
12 Indian fighters on the ground in Kalaikunda. For the rest of the 1965 war, the
IAF remained on the back foot. Since then, India has spent tens of billions of
dollars on military modernization, but the absence of a strong air defence
network means that a similar debacle could unfold again.

Former army
chief, General VK Singh, now a government minister, had gone on record to say
that India’s air defence is non-existent. The national air defence network,
which the IAF oversees and commands, has four major components: Air defence fighter
aircraft; anti-aircraft guns and missiles belonging to various units of the
army, navy and IAF; a network of radars and observers that monitors the
nation’s air space and detects enemy aircraft; and a command and control network
that tracks intruding fighters, and assigns them as targets to be intercepted
by IAF fighters or by ground gun and missile units. However, there remain
serious deficiencies in three of these four functions --- the radar network, the
fighter squadrons, and ground air defence units.

The most
worrying shortfall remains in fighter aircraft, with a decade having been
wasted in an ill-conceived global tender for procuring 126 medium multi-role
combat aircraft aircraft. Dassault’s Rafale fighter was announced the winner,
but the process stalled due to inconsistencies in the French vendor’s bid. Now,
inexplicably, the government is buying just 36 Rafales. With about 200 MiG-21s
and MiG-27 having retired or nearing retirement, the government plans to acquire
F-16 or Gripen NG light fighters, even as Hindustan Aeronautics Ltd scales up
production of the Tejas Light Combat Aircraft. This will leave the IAF with a
multitude of different fighter types, and major logistics problems in operating
and maintaining them across various fighter bases.

Meanwhile
air defence gun units field antiquated Soviet-era guns and missiles that should
have retired long ago. The mechanised forces too rely on Soviet-era air defence
systems from the 1980s, which are ineffective, given the advanced electronic
warfare equipment in modern fighters. The DRDO has worked for years with Israel
on co-developing state-of-the-art air defence missile systems but those are
only now reaching fruition. The government is buying the sophisticated Russian
S-400 Triumf long range missile system, but that is unlikely to be delivered
before 2018, since Moscow wants to equip its military first. Meanwhile, China is
also buying the S-400, although, like India, China too would have to wait for
delivery.

Lastly,
obsolescent radars with inadequate coverage ranges leave gaps along the border
that enemy aircraft can exploit to penetrate Indian airspace without being
detected. The DRDO has developed modern radars, but the supply lags far behind
the demand. India urgently needs to implement a comprehensive strategy that
takes into account all four aspects of our national air defence network. A
deteriorating environment in Kashmir and plummeting relations with Pakistan
brook no delay.